Banks

In 2009 Satoshi Nakamoto invented a new electronic or virtual currency called Bitcoin, the design goal of which is to provide an equivalent of cash on the Internet. Rather than using banks or credit cards to buy stuff online, a Bitcoin user will install a piece of software, the Bitcoin client, on her computer and send Bitcoin directly to other users under a pseudonym. One simply enters into the software the pseudonym of the person one wishes to send Bitcoin and the amount to send and the transaction will be transmitted through a peer-to-peer network. What specifically one can get with Bitcoin is somewhat limited to the few hundred websites which accept them, but includes other currencies, web hosting, server hosting, web design, DVDs, coffee in some coffee shops, and classified adverts, as well as the ability to use online gambling sites despite being a US citizen and to donate to Wikileaks. However, what allowed Bitcoin to break into the mainstream – if only for a short period of time – is the Craigslist-style website “Silk Road” which allows anyone to trade Bitcoin for prohibited drugs. Continue Reading

It’s that time again! Greece needs more loans and the governments in Europe are arguing about whether it’s really necessary and who should foot the bill. There is widespread opinion in Germany that Greece itself is to blame for the problems it now finds itself in. It first of all cheated its way into the Eurozone, then the government spent too much and the governed worked too little, many believe. Latently nationalistic patters of interpretation of this kind have been nourished by German politicians and the media, who have no end of proposals for how to «solve» the crisis. For example, the Greeks should save more, work more and sell their public property – and if all of these measures do not help, then Greece will just have to leave the Eurozone or declare itself bankrupt. The stupid thing is, neither are the causes of the crisis that have been named actually correct, nor will the proposed ways out of the crisis achieve their goal.
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The pension reforms of the years 2000 until 2007 were supposed to attenuate the foreseeable effects of demographic change on the pension system. This is why the retirement age was raised, the pension level was lowered and a so-called sustainability factor (“Nachhaltigkeitsfaktor”) was introduced into the pension formula. This approach meant a fundamental change of objectives – from safeguarding living standards in retirement to the stability of contribution rates. The lower future pension level is to be complemented by the subsidised formation of a private capital stock (“Riester pension”) without employer participation. The analysis of the macroeconomic consequences of this reform shows that the chosen policy of enhanced funding both dampens growth and leads to insufficient income in old age. Thus the current strategy is not suitable for alleviating the demographic burden. Read more (in German language)

Doug Henwood delivered ”Nationalize the Banks! What Does it Really Mean?,” on a panel organized by the Socialist Register, at the Left Forum, New York City, April 19, 2009:

“The title of our session reminds me of that glorious week in Seattle back in December 1999. At that time, and for a little while afterwards, it seemed like a new movement had been born, and there was some real potential for transforming, or even overthrowing, capitalism. One of my favorite chants of that moment of carnival came from the unfairly maligned Black Bloc: “Capitalism? No thanks! We will burn your fucking banks!” Not constructive, perhaps, but inspiring nonetheless.”

Financial Meltdown. The US- government has agreed to a 700 bn bail-out to rescue the financial market. The largest bail-out of all times. This is all highly dramatic. However, despite all the drastic measures, there are contradictory messages: The banking system as a whole is not under threat. The private savings are supposedly safe. The consequences of the huge bankruptcies in the US for Europe/ Germany/ the global financial system are unpredictable. Additionally, there are these experts who voice their concern in a refreshingly open fashion: we do not really know what is going on (first hints are collected at the RLS City Crash Counter), what is connected to what (for more hints on that see “Capitalism Hits the Fan”) and what is going to happen next.